Facebook and Beyond: Lessons for Brand Engagement with Social Customers

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

Executive Summary
As recently as two or three years ago, the idea that brands would provide a social channel for their customers to engage with them was controversial, even radical. Now its convention. Facebook is a big reason for this change. As of this writing, 56 percent of Fortune 500 companies host Facebook pages, and that number is growing daily. Since social customer programs were controversial just two years ago, many of those companies are new to the experience of engaging with social customers and are looking to answer the question, What do we do next? Brands that have engaged with social customers in other channels can help us answer this question. Lithiums clients have considerable experience with social customer engagement through brand communities and Facebook pages. Lithium conducted a survey of its clients to better understand how they see the role of Facebook (and other social media outlets) in their overall engagement strategy. The results provide an interesting glimpse into the different roles played by different social media channels, and potentially into how they will converge in the future. Some highlights include: On the whole, respondents rated their communities as more successful than Facebook at activities that require trust: peer-to-peer engagement and providing pre-and-post sales purchase support; Facebook was seen as more successful in disseminating marketing messages. The two channels were seen as roughly equal in their ability to create brand awareness. Clients who have initiated brand communities see awareness benefits as particularly salient in the first year, suggesting that newness of an engagement channel is in itself a big driver of awareness. The ability for customers to submit and discuss ideas for product or service improvement is the biggest downstream benefit of social customer engagement for clients who have developed brand communities. Clients who consider their Facebook efforts less successful are particularly interested in bringing this capability to Facebook in a more structured fashion.

After Peak Facebook

As Facebook itself approaches full penetration of its core markets and its members start to regularize their behavior, historic growth rates for participation in corporate Facebook pages will slow. Call it peak Facebook. Recent surveys have also shown that existing consumers engagement with corporate Facebook pages may be tenuous and fading. For example, 81% of those who have become fans of a brand have abandoned at least one such relationship because of irrelevant, voluminous, or boring marketing messages. 2

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

This suggests that marketers who are committed to using Facebook to foster relationships with social customers will need to invent or adopt sophisticated long-term strategies for customer engagement. Fortunately, many of the techniques learned in brand communities can carry over into Facebook.

What Is an Online Community?

One of the first questions we see from brands developing a social customer strategy is, Do I need both a brand community and Facebook, and if so, what role does each one play? The answer to this question always depends on circumstances and business requirements, but given that our audience has experience with both venues, we have a very good sense of the role that each one plays.
improves our search results creates awareness of our brand, products, or services allows us to communicate our marketing message effectively to customers creates beneficial customer-to-customer engagement empowers customers to help one another with pre-sales purchase questions empowers customers to help one another with post-sales support questions Gives us metrics we need to assess program goals Gives us a good sense of how our customers are feeling Helps us identify particularly valuable customers Creates goodwill for our brand in social channels community effectiveness facebook effectiveness

Figure 1: Overall effectiveness of Facebook and brand community. Figure 1 compares the brand communitys perceived effectiveness with the Facebook pages perceived effectiveness in 10 different areas.

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

The first thing to note is that the one area where Facebook shines is in outbound messaging. Because Facebook offers outstanding reach and many brands use it as a publishing platform for periodic updates, its prowess as a vehicle for disseminating marketing messages is not surprising. Social media marketing vendor Vitrue has computed that a fan base of 1 million translates into $3.6 million in equivalent media per year, and brands such as Coca-Cola already see more unique visitors to their Facebook page than they do to their company web site. In these situations, Facebook represents a means of message dissemination that compares favorably to advertising on a cost-per-impression basis.Interestingly, however, Facebook was not cited as significantly more effective than a brand community in creating brand awareness, or creating goodwill for the brand in social channels. Given the Facebook platforms reach and viral features, one might have expected higher scores for Facebooks ability to increase brand awareness, but there are several reasons why the scores may be lower than expected: Brand awareness is still largely campaign driven, and a Facebook page alone does not constitute a campaign. Even when campaigns drive users to Facebook pages and increase the brands fan base, there is no guarantee that these people were new to the brand. Most users who associate with a brand page probably have a prior affinity for that brand. Finally, as we have seen through social media monitoring studies, buzz around brands spikes during successful campaigns, but typically returns to a steady state after campaigns end.

One further explanation may be that our community clients report that brand awareness benefits peak during the first year, even as other benefits increase over time. If this holds true across other social channels, it is possible that the fact of starting a new program in and of itself is responsible for increased awarenessprobably because that program involves an introductory campaign. When the shock of the new wears off, what is left? As it turns out, brand communities annuitize exceptionally well. Peer-to-peer engagement and an environment where users answer one anothers questions emerge as a corps of devoted users forms and mobilizes. Indeed, scores rise in these areas as communities move into their second and third years, suggesting that communities hold their users interest over the long haul.

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

anticipated
13.5%

realized
27%

anticipated

realized

46% 78%

pre-sales consultation

customer feedback/ideation

Figure 2: Anticipated benefits versus realized benefits. Peer-to-peer buying advice and customer ideation were two benefits exceeding client expectations. The survey tells us that benefits clients anticipated when embarking upon a social customer program are not always the same benefits that emerge over time. This is particularly true in two areas: idea development, and peer-to-peer pre-sales consulting. Customer feedback/ideation was listed as an original purpose of a community 46% of the time, but a realized benefit 78% of the time. Peer-to-peer pre-sales consulting was an original purpose 13.5% of the time but a realized benefit 27% of the time. Both of these downstream benefits are most likely to emerge as byproducts of trust among members of a community. Brands tend to be more willing to harvest and discuss ideas for service improvement when they trust that their customers are ready for a sustained dialog rather than drive-by complaints. And people are more willing to trust product recommendations from their peers when those peers have proven themselves to be reliably knowledgeable over time. To see these benefits, brands must cultivate relationships with their social customers over the long term. While the constraints and affordances of the Facebook platform and brand communities differ, there is no reason why the aspects that make brand communities deliver annuitized benefits cannot exist in Facebook. Whether they will emerge depends largely upon the choices that brands make about how to engage with their customers on Facebook. And those choices will likely depend on whether brands consider what they are doing on Facebook successful or not.

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

Success/Failure and Future Needs

As we can see from Figure 3, among respondents who consider their Facebook efforts successful or very successful, three key benefits stand out: the creation of brand awareness, the ability to communicate marketing messages effectively, and the fostering of goodwill in social channels. In each of the three cases, there is a wide gap in perceived efficacy between respondents who are happy with their Facebook efforts and those who are not. On the other hand, even those who are happy with their Facebook program do not consider it to be very useful in helping users answer one anothers questions (either pre- or post-sales) or in helping them identify particularly valuable customers.
facebook page's effectiveness
improves our search results creates awareness of our brand, products, or services allows us to communicate our marketing message effectively to customers creates beneficial customer-to-customer engagement empowers customers to help one another with pre-sales purchase questions empowers customers to help one another with post-sales support questions Gives us metrics we need to assess program goals Gives us a good sense of how our customers are feeling Helps us identify particularly valuable customers Creates goodwill for our brand in social channels
more successful less successful more successful less successful

community's effectiveness

Figure 3: Facebook and brand community effectiveness in 10 areas, cross-tabulated by more successful and less successful overall perceptions of success Strikingly, only about 12% of respondents who consider their Facebook forays successful believe that it helps users answer one anothers questions. Fewer than half thought it created beneficial interactions of any kind among customers. At this point in its evolution, Facebook seems to succeed or fail for brands based on reach and the perceived goodwill that goes along with that, rather than on elements that are specifically social.

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

As we can also see from Figure 3, respondents who see their community as successful or very successful give the community exceptionally high marks for creating beneficial peer-to-peer engagement, for helping customers with questions, and for providing insight into customers attitudes. Interestingly, there is basically no difference in clients assessment of a communitys utility for communicating outbound marketing messages between those who think it is a roaring success and those who think it is moderately successful. On the other hand, there is a large perceived gap in the awareness value of a community between those who feel it is very successful and those who feel it less so. Perhaps one reason for this discrepancy is that members themselves are the marketing channel in a brand community. Even though it provides opportunities for outbound communicationthough blogs and tweetsa brand community succeeds or fails on the basis of its ability to create engagement.
51.4% 50% 42.9% 8.3% 62.9% 50% 60% 66.7% 60% 58.3% 42.9% 50% 60% 50%

answer product questions display status or achievements submit ideas for service/product improvements search our knowledge base see the best/most useful content that others have submitted identify other customers with similar backgrounds or needs find products their friends or colleagues have recommended

mentions by respondents who rate their Facebook pages as less successful mentions by respondents who rate their Facebook pages as successful

Figure 4: Additional needs from Facebook by perceived success level with Facebook.

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

We can see that when Facebook isnt seen as successful for brands, its best benefits are still as an outbound marketing vehiclejust not a particularly successful one. In that case, what do brands want Facebook to do for customers that its not doing? We asked respondents to rank various things that their customers might do on Facebook that they cant do or cant do well. When we correlate those rankings with the level of success those clients are currently enjoying with Facebook, several things stand out: Overwhelmingly, brands whose Facebook efforts are flagging want some way to recognize their customers status and achievements on Facebookin other words, to reward good behavior. Conspicuous display of status and achievement is a deeply ingrained feature of Lithium communities and is generally seen as a prime motivator of consumer participation. Respondents who do not see their current Facebook efforts as successful see the ability for customers to submit ideas as substantially more important than those who are satisfied with Facebook. Again, this maps very closely to the ideation benefit we saw earlier as a downstream effect of brand communities. The ability to find products or services recommended by friends or colleagues is also seen as a potential area of improvement by those who are not particularly satisfied with their Facebook efforts.
answer product questions display status or achievements submit ideas for service/product improvements search our knowledge base see the best/most useful content that others have submitted identify other customers with similar backgrounds or needs find products their friends or colleagues have recommended 47.6% 56% 52.4% 20% 57.1% 64% 57.1% 64% 57.1% 60% 38.1% 52% 47.6% 64%

mentions by respondents who rate their communities as less successful mentions by respondents who rate their communities as successful

Figure 5: Additional needs from Facebook by community success level. 8

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

As we can see from Figure 5, brands who are less successful with communities also want to see a more prominent display of status and achievements on Facebook. But what is perhaps more interesting is that clients who are at higher levels of success with brand communities are much more interested than their peers in introducing the ability for users to find others who resemble them, and the ability for users to locate products that their friends and colleagues like. These are characteristic social networking features. In other words, when Facebook efforts are not successful, brands want Facebook to behave more like a community. When communities are successful, brands want to benefit from Facebooks networking features to a greater extent. If Facebooks potency as a generator of awareness begins to decline over time, that trend suggests a convergence between the interaction modes in Facebook and those of brand communities is extremely likely.

Organizational Ownership
If we see a coming convergence between the way people interact on Facebook and the way they interact in a brand community, it is worth asking who will lead that convergence and how it will take place. Enterprises vary in their determination of who owns social customer initiatives. In some organizations, social customer initiatives are owned by customer support or customer experience teams. Increasingly, however, they fall under the purview of marketing or corporate communications functions.
answer product questions display status or achievements submit ideas for service/product improvements search our knowledge base see the best/most useful content that others have submitted identify other customers with similar backgrounds or needs find products their friends or colleagues have recommended 61.5% 36.8% 46.2% 21.1% 73.1% 42.1% 73.1% 47.4% 69.2% 47.4% 50% 36.8% 61.5% 52.6%

customer support and experience groups marketing groups

Figure 6: Additional requirements from Facebook by social program ownership.

Facebook and Beyond: Lessons for Brand Engagement with Social Customers

As we can see from Figure 6, organizations where marketing owns social initiatives are demanding less of Facebook in terms of new modes of customer engagement. In fact, ownership by marketing is more important than the perceived success of a companys Facebook page in determining whether a company is interested in customers engaging through Facebook in more involved ways. Customer support and customer experience groups continue to be more interested in the exchange of ideas and the answering of product questions.

customer support and experience f e d c a b

marketing and comms f e d c b

Figure 7: Largest challenge with social customer programs, by program ownership

a) executive buy-in b) resources to scale our efforts Marketing-led organizationscoordination acrosswith social customer programs is how c) biggest concern teams and departments d) too many tools to scale them. Figure 7 shows the chief concern as scaling initiatives with (relatively) e) lack of agreed upon and departments. 44% success less concern about coordination across teams metrics and standards for of marketing-led f) lack of customer interest organizations cited resources to scale our efforts as the biggest challenge, as against

34.4% of everyone and (9/34 - 26%) of non-marketing led organizations. This suggests that one reason marketers are less aggressively pursuing deeper engagement through Facebook is that, unlike support or customer experience organizations, they lack human resourceslike contact centersthat are perceived to be required to ensure that social customers get the satisfaction they require from engagement through Facebook. Better, perhaps, not to hold out the promise of a sustained dialog with customers if an organization cannot make good on that promise.

The survey shows that marketers and customer experience are equally committed to responding to customers in brand communities and through Facebook and Twitter. However, it would not be surprising if Facebooks reach threatens to become overwhelming if customer actions on Facebook called for a response. Indeed, perhaps

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Facebook and Beyond: Lessons for Brand Engagement with Social Customers

one thing that marketers have learned with online communities that they have not (yet) learned with Facebook is that customers themselves can be the solutionnot just the causeof the scaling problem. Time and again, we have seen that larger communities with a devoted core of superfans actually require less intervention from companies than fledgling communities. The downstream trust benefits pay dividends. There is no reason why this shouldnt be so on Facebook, but many organizations are in earlier stages of their experience with Facebook.

brand communities

facebook

twitter

youtube

linkedin customer support and experience marketing and corp comms

Figure 8: Requirement for ROI measurement by channel and program ownership. A final area in which brand communities differ from other channels for marketing-led organizations is in the need to prove themselves through ROI metrics. As we can see from Figure 8, marketing-led organizations generally have higher demands for ROI, but this is particularly true for brand communities. We suspect this is a function of the perception that Facebook engagement is free because a Facebook page is itself free, but also of the maturity level of Facebook as a technology and a marketing venue. As we see increasing convergence of social channels, we should also expect to see demands for more sophisticated Facebook measurement tools, and growing demands for Facebook to prove its value.

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Facebook and Beyond: Lessons for Brand Engagement with Social Customers

Conclusion
There are significant synergies between Facebook and brand communities. Both offer unique marketing advantages, and weve helped customers extend the reach of their brand communities on Facebook. For its sheer size and viral features, Facebook is generally considered more successful at disseminating marketing messages, and is roughly equal in its ability to create brand awareness. As weve seen in online venues before, however, driving people to a social site without providing an outlet for their needs invites a peak-and-trough customer engagement, rather than a sustained, vital and profitable enthusiasm. A campaign-based wave of awareness will eventually peak and subside, and may then create unrealistic expectations for customers. As these channels evolve and the awareness benefits subside, marketers should consider Facebook a useful platform for cultivating an online presence run more like a community than a campaign. The dividends of a well-developed Facebook presence will ultimately depend on marketers inventing or adopting sophisticated long-term strategies for customer engagement, such that their Facebook presence derives its value from peer-to-peer relationships. But those relationships also have to be based in trust, both among customers and between customers and the brand. Establishing this trust is a key, longterm strategy. For instance, fostering productive peer-to-peer relationships among customers and rewarding positive behavior helps to create trust, as does identifying, motivating, and highlighting your brands superfans. The downstream annuities of trust and engagement only grow when brands cultivate true, multi-directional relationships with their social customers over the long term. The potential ROI is tremendous.

Lithium lithium.com | 6121 Hollis Street, Suite 4, Emeryville, CA 94608 | tel 510.653.6800 | fax 510.653.6801 2011 Lithium Technologies, Inc. All Rights Reserved.

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